Rolling Suds Franchise Logo

Rolling Suds Franchise

Rolling Suds Franchising LLC
https://www.rollingsudsfranchise.com
1-609-742-2276
3662C Central Pike, Hermitage, Tennessee 37076

Initial Investment Range

$186,150 to $384,250

Franchise Fee

$84,900 to $164,700

The franchisee will operate a power washing business for residential and commercial buildings and structures using a low-pressure, soft wash technique and related services and products under the "Rolling Suds" trademarks.

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Rolling Suds Franchise April 14, 2025 FDD Risk Analysis

Free FDD Library AI Analysis Date: July 16, 2025

DISCLAIMER: Not Legal Advice - For Informational Purposes Only. Consult With Qualified Franchise Professionals.

1

Franchisor Stability Risks

Start Here
Total: 10
4
1
5

Disclosure of Franchisor's Financial Instability

High Risk

Explanation

The franchisor's audited financial statements reveal significant financial weakness. As of year-end 2024, Rolling Suds Franchising LLC (Rolling Suds) reported negative members' equity of ($556,226) and a net loss of ($971,982). This financial position may suggest challenges in funding ongoing support, investing in the brand, or achieving profitability. Such factors could increase the risk for franchisees who depend on the franchisor's viability and resources.

Potential Mitigations

  • A detailed review of the financial statements, including footnotes and cash flow analysis, with your accountant is essential to assess long-term stability.
  • Discussing the franchisor's capitalization and plans for achieving profitability with your financial advisor can provide crucial context.
  • Your attorney should investigate if any financial performance bonds or escrow arrangements are required by state regulators due to this financial condition.
Citations: Item 21, Exhibit C

High Franchisee Turnover

High Risk

Explanation

Item 20 data indicates an exceptionally high rate of franchise transfers. In 2024, there were seven transfers, which represents 100% of the franchised outlets that were open at the start of that year. While these are not listed as terminations, such a high level of ownership change in a short period for the initial cohort of franchisees can be a significant indicator of potential systemic issues, franchisee dissatisfaction, or unprofitability within the system.

Potential Mitigations

  • It is critical to contact a significant number of the former franchisees who transferred their outlets to understand their reasons for exiting.
  • A franchise attorney can help you formulate specific questions about profitability, support, and the circumstances surrounding their transfer.
  • Your accountant should help you assess the financial implications if such a high turnover rate reflects underlying business model challenges.
Citations: Item 20

Rapid System Growth

High Risk

Explanation

The franchisor is experiencing explosive growth, expanding from 8 to 67 total outlets in 2024. While growth can be positive, such rapid expansion can strain a new franchisor's resources. There is a risk that the infrastructure for training, site selection, supply chain management, and ongoing operational support may not keep pace with the number of new franchisees joining the system, potentially leading to inadequate assistance for you.

Potential Mitigations

  • In discussions with the franchisor, inquire specifically about their plans to scale support staff and systems to manage this rapid growth.
  • Your business advisor can help you evaluate the adequacy of the current support infrastructure described in Item 11.
  • Contacting franchisees who joined at different stages of this growth phase can provide insight into the consistency of support.
Citations: Item 20

New/Unproven Franchise System

High Risk

Explanation

Rolling Suds is a new franchisor, having been formed in 2022 and only beginning to offer franchises in August 2022. This is explicitly stated as a 'Short Operating History' in the FDD's Special Risks section. Investing in a new, unproven franchise system carries higher risk as the business model, support systems, and brand recognition are not yet fully established. The long-term viability and profitability for franchisees have not been demonstrated over time.

Potential Mitigations

  • A thorough due diligence process, guided by your business advisor, is crucial to vet the concept and the management team's capabilities.
  • Speaking with the earliest franchisees in the system is essential to understand their experience with the developing support structures.
  • Your attorney may be able to negotiate more franchisee-favorable terms in the agreement to compensate for the higher risk of a new system.
Citations: Items 1, 2, 20, 21, Special Risks Section

Possible Fad Business

Low Risk

Explanation

This risk was not identified in the FDD Package. The business model, professional power washing, is a well-established service industry with consistent demand and is not dependent on a short-term trend or fad. This suggests a more stable market foundation compared to businesses built around novel or fleeting consumer interests.

Potential Mitigations

  • A business advisor can help you research the long-term demand and competitive landscape for power washing services in your specific market.
  • When evaluating any franchise, it is wise to consider the sustainability of its core business offering with a financial advisor.
Citations: Not applicable

Inexperienced Management

Medium Risk

Explanation

While the founder of an affiliate company has long-term industry experience, the franchising entity itself is new (formed 2022) and several key C-level executives were only hired in 2024. A newly assembled management team, even with individual experience, may lack a track record of working together effectively to manage a franchise system. This could impact the quality and consistency of strategic direction and franchisee support, particularly during a period of rapid growth.

Potential Mitigations

  • Carefully review the biographies in Item 2 with a business advisor to assess the collective experience in both the industry and in franchising.
  • When speaking with current franchisees, ask about the effectiveness and responsiveness of the management team.
  • Question the franchisor about their management philosophy and how the team's experience will be leveraged to support franchisees.
Citations: Items 1, 2, 11

Private Equity Ownership

Low Risk

Explanation

This risk was not identified in the FDD Package. Item 1 indicates the franchisor is a limited liability company and does not appear to be owned or controlled by a private equity firm. This can be a positive factor, as management's focus may be more aligned with the long-term health of the brand rather than short-term investor return horizons that can sometimes characterize PE ownership.

Potential Mitigations

  • Your attorney can help you verify the ownership structure of the franchisor and its parent companies as disclosed in Item 1.
  • Understanding the ownership structure is a key piece of due diligence that should be discussed with your business advisor.
Citations: Not applicable

Non-Disclosure of Parent Company

Low Risk

Explanation

This risk was not identified in the FDD Package. Item 1 discloses the existence of a parent company, Rolling Suds Holdings, LLC. While the parent's financials are not included, the franchisor's own financials are audited and provided. The structure appears transparent, mitigating the risk of a hidden parent entity controlling the system from behind the scenes without financial disclosure.

Potential Mitigations

  • Your accountant should review the provided franchisor financials to assess their stability, regardless of the parent company.
  • Your attorney can confirm the relationships between the franchisor, parent, and other affiliates described in Item 1.
Citations: Not applicable

Predecessor History Issues

Low Risk

Explanation

This risk was not identified in the FDD Package. Item 1 does not disclose any predecessor entities from which Rolling Suds acquired its assets or that previously offered franchises for this system. The franchisor is presented as a new entity, and while it has an affiliated operating company, it is not a legal predecessor. This avoids the risk of inheriting undisclosed historical problems from a prior company.

Potential Mitigations

  • Your attorney should confirm the corporate history as disclosed in Item 1.
  • For any franchise, it is good practice to ask about the full history of the brand, which a business advisor can help investigate.
Citations: Not applicable

Pattern of Litigation

Low Risk

Explanation

This risk was not identified in the FDD Package. Item 3 states that no litigation is required to be disclosed. The absence of a pattern of lawsuits filed by or against franchisees, particularly concerning claims of fraud or misrepresentation, is a positive indicator. It suggests a healthier franchisor-franchisee relationship dynamic compared to systems with significant legal disputes.

Potential Mitigations

  • An attorney can perform an independent public records search to verify the absence of significant litigation.
  • Asking current and former franchisees about their experiences and any disputes they are aware of is a crucial due diligence step.
Citations: Not applicable
2

Disclosure & Representation Risks

Total: 15
5
3
7

Example Risk: Franchisee Financial Obligations

Blue Risk

Explanation

This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.

Potential Mitigations

  • Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
  • Conduct regular risk assessments
  • Implement monitoring and reporting systems

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3

Financial & Fee Risks

Total: 10
5
4
1

Example Risk: Franchisee Financial Obligations

Blue Risk

Explanation

This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.

Potential Mitigations

  • Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
  • Conduct regular risk assessments
  • Implement monitoring and reporting systems

Unlock Full Risk Analysis

Purchase the complete risk review to see all 102 risks across all 10 categories.

4

Legal & Contract Risks

Total: 16
6
5
5

Example Risk: Franchisee Financial Obligations

Blue Risk

Explanation

This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.

Potential Mitigations

  • Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
  • Conduct regular risk assessments
  • Implement monitoring and reporting systems

Unlock Full Risk Analysis

Purchase the complete risk review to see all 102 risks across all 10 categories.

5

Territory & Competition Risks

Total: 5
1
2
2

Example Risk: Franchisee Financial Obligations

Blue Risk

Explanation

This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.

Potential Mitigations

  • Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
  • Conduct regular risk assessments
  • Implement monitoring and reporting systems

Unlock Full Risk Analysis

Purchase the complete risk review to see all 102 risks across all 10 categories.

6

Regulatory & Compliance Risks

Total: 10
4
3
3

Example Risk: Franchisee Financial Obligations

Blue Risk

Explanation

This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.

Potential Mitigations

  • Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
  • Conduct regular risk assessments
  • Implement monitoring and reporting systems

Unlock Full Risk Analysis

Purchase the complete risk review to see all 102 risks across all 10 categories.

7

Franchisor Support Risks

Total: 4
1
2
1

Example Risk: Franchisee Financial Obligations

Blue Risk

Explanation

This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.

Potential Mitigations

  • Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
  • Conduct regular risk assessments
  • Implement monitoring and reporting systems

Unlock Full Risk Analysis

Purchase the complete risk review to see all 102 risks across all 10 categories.

8

Operational Control Risks

Total: 12
5
4
3

Example Risk: Franchisee Financial Obligations

Blue Risk

Explanation

This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.

Potential Mitigations

  • Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
  • Conduct regular risk assessments
  • Implement monitoring and reporting systems

Unlock Full Risk Analysis

Purchase the complete risk review to see all 102 risks across all 10 categories.

9

Term & Exit Risks

Total: 18
10
8
0

Example Risk: Franchisee Financial Obligations

Blue Risk

Explanation

This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.

Potential Mitigations

  • Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
  • Conduct regular risk assessments
  • Implement monitoring and reporting systems

Unlock Full Risk Analysis

Purchase the complete risk review to see all 102 risks across all 10 categories.

10

Miscellaneous Risks

Total: 1
1
0
0

Example Risk: Franchisee Financial Obligations

Blue Risk

Explanation

This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.

Potential Mitigations

  • Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
  • Conduct regular risk assessments
  • Implement monitoring and reporting systems

Unlock Full Risk Analysis

Purchase the complete risk review to see all 102 risks across all 10 categories.